The Colossus personal injury calculator is a computer claims software program that many auto insurance companies use to generate a range of what a settlement value is for an injury based on various factors and location. The premise behind claims assessment software is that settlement values can be continually driven lower over time by calculating a median of what a particular injury is worth, and then offering less.
While the Colossus personal injury calculator could theoretically have some value in the claims handling process, the reality is that this software has been abused by insurance companies and has itself been the basis of several bad faith lawsuits and state attorney general settlements.
Rather than being one of many factors for claims adjusters and auto insurance companies to consider in determining the settlement value of a car accident victim’s injuries, in most cases it ends up being the only factor that is used by auto insurance companies. Claims adjusters have limited authority to negotiate beyond the range of what the claims software settlement range is for a given injury, and often can come under fire and even be financially penalized for doing so.
Most auto insurance companies strictly prohibit their claims adjusters from settling a claim for any amount over the settlement range calculated by the Colossus computer software program. I have many claims adjuster friends from being in this business for almost 30 years, and most tell me that even if they wanted to, adjusters still would not have the authority to settle. Adjusters complain to me that they have been relegated to gathering and inputting information into the computer and conveying the computer’s non-negotiable settlement valuations, just as insurance defense lawyers like to complain to me that they just “carry water” but adjusters rarely listen to them anymore.
This is all obviously incredibly unfair for car accident injury victims. Setting aside the fact that the software can be – and is routinely – intentionally manipulated by the insurance companies, it is also subject to completely mis-evaluate a claim based on the information that a claims adjuster inputs into the claims assessment software.
What is the Colossus personal injury calculator?
The Colossus personal injury calculator is a claims handling computer software program that is designed to low-ball and aggressively defend car accident lawsuits. It “calculates” artificially low settlement offers on car accident victims’ pain and suffering settlements, thereby allowing insurers to save money and increase profit margins.
The goal of the software is not to determine the fair settlement value for a car accident victim’s injuries and pain and suffering compensation claim.
The goal is instead to methodically drive down auto accident settlement amounts to artificially low levels so the insurance companies can save more and more money over time, regardless of whether they’re settling legitimate accident claims.
What is the purpose of the Colossus personal injury calculator?
The purpose of the Colossus personal injury calculator is to reduce the settlement value of an injury over time, which in turn allows the insurers to reduce the size of settlement payouts and increase profits.
In fact, sales literature published by the manufacturer of the Colossus personal injury calculator boasted that “‘the program will immediately reduce the size of bodily injury claims by up to 20 percent,’” according to the Consumer Federal of America.
For Allstate, that proved to be the case, according to BusinessWeek. Over a ten-year period, “the amount of money [Allstate] paid out per premium dollar in car accident injury cases declined from about 63 cents to 47 cents,” which is approximately a 25% drop.
How does the Colossus personal injury calculator work?
Insurance adjusters feed various case and injury data inputs into the computer software program, which then uses that data to assign a settlement range for an auto accident victim’s bodily injury claim.
The information that adjusters input into the Colossus personal injury calculator must correspond to one or more of the 750 injuries and one or more of the 10,720 rules or value drivers that are recognized by the software.
The value that the computer software determines for a car accident victim’s pain and suffering compensation claim is supposed to be based on points assigned to the value drivers associated with each of the victim’s injuries. However, each insurance company is free to adjust (manipulate) the computer claims assessment program with its own value drivers which would raise or lower the settlement value for an injury.
How are car accident victims harmed by adjusters’ use of the Colossus personal injury calculator?
This claims assessment program is deliberately designed NOT to offer full settlement value for an injury. In addition, claims adjusters are frequently required by auto insurance companies to withhold, modify and/or lower the settlement offer based on the inputs entered into the Colossus personal injury calculator, which has led to bad faith insurance lawsuits against several auto insurance companies. Claims adjusters are also not allowed to settle a claim for more than what the Colossus claims assessment computer software says, which has also led to bad faith litigation and lawsuits.
The effect of claims assessment software like this is that car accident victims are dealing with an auto insurance company that has limited settlement negotiations to an artificial and often arbitrary settlement range that fails to take many important factors into account.
In addition, auto insurance companies frequently offer bonuses and financial rewards to adjusters who settle within or even at the law end of the settlement value ranges identified by the Colossus personal injury calculator.
Allstate’s Colossus personal injury calculator
In 2010, Allstate got into significant national trouble for its abusive use of the Colossus personal injury calculator to force unsuspecting car accident victims into accepting low-ball, undervalued settlement offers on their pain and suffering compensation claims.
As a result, Allstate had to enter into a “Multi-State Market Conduct Regulatory Agreement” with the Insurance Commissioners of 48 states, including Michigan, to change how it uses the claims assessment software in its auto insurance claims handling process.
In Michigan, Allstate promised to:
- Not require insurance claims adjusters “to settle claims based solely on the value recommended by the Colossus software program.”
- No longer reward or “provide incentives” to its insurance claims adjusters for settling car accident claims for the amounts specified by the Colossus computer program.
- Notify claimants when the Colossus software program is being used to adjust their claims. The notification will include the following disclosure: “One of the tools that our claim personnel may use in evaluating your claim is a computer program known as Colossus, licensed by Computer Sciences Corporation. Colossus uses a broad range of information about your injury, treatment, and prognosis to determine the severity of your injury. Based on this information, Colossus makes a recommendation as to the value of your injury. The Colossus recommendation is only one factor among many that our adjusters consider in reaching a decision as to the overall evaluation of the claim.”
Allstate refuses to give settlement value range
Even though Michigan’s Insurance Commissioner has recommended that Allstate provide the settlement value range to car accident victims who have made pain and suffering compensation claims, Allstate has refused to do so.
In its June 2014 Market Conduct Examination of Allstate Property and Casualty Insurance Company, Michigan’s Insurance Commissioner noted that Allstate “does not provide a copy of the Colossus evaluations to claimants.”
After acknowledging that Colossus’s manufacturer stated on its website that “Colossus evaluations are provided by most insurance companies,” the Insurance Commissioner recommended that Allstate “follow this practice.”
Allstate refused: “We are not required to provide Colossus evaluations.”
It is believed that the Insurance Commissioner has taken no subsequent action to enforce its recommendation.
How your attorney affects the Colossus personal injury calculator
Your choice of a car accident attorney to help you after a car accident will have an enormous impact your case’s settlement value as determined by the software.
Cases settle for more money and faster when a car accident victim’s attorney ranks high on the following factors: (1) the settlement history and trial record of your attorney; (2) the trial verdicts of the attorney; and (3) the financial viability of the lawyer and law firm to fund a case through trial and possible appeal.
As an example of how important your attorney is, I have taken over auto accident cases and been referred many cases by other lawyers. Often, I can settle a case for significantly more money than the previous attorney just because my name and law firm are on a settlement demand. Farmers Insurance Company, as another example, authorizes its claims adjusters to pay up to four times more for the settlement value of a case based upon the name and reputation of the plaintiff attorney representing that claimant.
If you want to find out how much your own car accident case may be worth, you can check out our car accident settlement calculator or call us toll free anytime 24/7 at (248) 353-7575 for a free consultation with one of our experienced attorneys.
How to protect yourself
To ensure that the Colossus personal injury calculator does not deprive you of a fair car accident settlement, you should do the following:
- Find out if your insurer and claims adjuster is using Colossus for your auto accident claim.
- Do not accept a settlement offer that is based on Colossus without talking to an experienced auto accident attorney.
- Consider filing a complaint with the Insurance Commissioner if your insurer either refuses to show you the settlement value range and/or refuses to settle for the high end of the settlement range.
Have questions? Contact Michigan Auto Law for a free consultation
If you have questions about the settlement value that the Colossus personal injury calculator has determined for your car accident case and would like to speak with an experienced attorney, call toll free anytime 24/7 at (248) 353-7575 for a free consultation with one of our attorneys. You can also get help from an experienced accident attorney by visiting our contact page or you can use the chat feature on our website.
(Sources: Consumer Federation of America, “The ‘Good Hands’ Company or a Leader in Anti-Consumer Practices? Excessive Prices and Poor Claims Practices at the Allstate Corporation,” July 18, 2007, at 21; BusinessWeek, “In Tough Hands at Allstate,” May 1, 2006; DIFS, Market Conduct Examination Number 2013C-0059, Targeted Market Conduct Examination Report of Allstate Property and Casualty Insurance Company, June 20, 2014 (pages 1 and 8 of the report))
